A Guide to Estate Planning

At the point when you realize that you are not going to live forever after all, you begin to think about your legacy. Not so much what you accomplished over your lifetime, but what you will do with all the stuff you accumulated over a lifetime of reckless consumption. You will need to decide who will get your most cherished belongings like your 8-track tape library and Grateful Dead ticket stubs. You will need to decide what to do with whatever cash (or assets, as the professionals call it) you might have on hand when you head off to meet your maker.

Speaking of cash, lawyers have a foolproof technique for dramatically reducing your cash on hand. It’s called estate planning. Not only is it wildly expensive, lawyers make the process so complicated that no one can even pretend to understand the basic principles, never mind the words on the page.

Part of the problem that is the language used in the estate planning is so obscure it sounds like old english or something out of the the Code of Hammurabi. The documents may actually be middle english since your lawyer has been using the same templates for every customer since the dark ages.

You will quickly discover that the fees you pay are totally unrelated to the actual work involved. When it comes to estate planning, you pay by the ton. A deluxe estate plan would be about the size of the Manhattan phone book if it still existed. It will include a Healthcare Proxy, Power of Attorney, Last Will and Testament, Revocable trusts, Irrevocable trusts, and a partridge in a pear tree. And make sure you have a living trust because it won’t do you any good if it is dead.

If you are fortunate enough to have a lot of loot and are inclined to give it away, you can create all sorts of charitable trusts and foundations that will make sure your money goes mostly to the right causes like your lawyers retirement account.

So why go through all the trouble and expense?

First, you are told, it will be easier for your heirs to deal with your estate after you are gone. They will save the time, cost and complexity of dealing with Probate Court. What your heirs won’t be able to do is shake the lawyers that will continue to bilk them for the rest of their lives. When your lawyers talk about wealth transfer, make sure you understand where it is actually being transferred.

Estate planning, you are told, will also help avoid the dreaded estate tax at the time of your death. This will limit the amount of money the government can take after you are dead and can no longer hide it. Luckily, recent republican administrations have made the estate tax exemption so big you can drive a 300-foot mega yacht through it.

Some lawyers, in an effort to expand the estate planning grift, are also in the asset management business. This profitable sideline lets lawyers manage your money before you die as well as after. This is grossly unfair to financial advisors who are entitled to some of your estate as well. You don’t see financial advisors horning in on the estate planning racket. At least not yet.